A STUDY OF CORPORATE FARM
EMPLOYER—EMPLOYEE RELATSONS

mess FOR THE DEGREE CFM. 5.
MiCHIGAN STATE UNWERSITY

LOREN RAY SLOAT

1969

LIBRARY g"

THEas

Michigan State
University

 

ABSTRACT
A STUDY OF CORPORATE FARM
EMPLOYER-EMPLOYEE RELATIONS
By
Loren R. Sloat

Eleven farms, in the lower portion of Michigan,
organized as corporations were selected as sources of
information for this study on the posture of corporate
farm labor. All farms were owned by two or more common
stockholders and were closely held.

The objective of this study was to determine if the
relationship that exists between corporate farm employers
and employees is any different than the relationship that
exists between non-corporate farm employers and employees;
this relationship being dependent on wages, hours, fringe
benefits, working conditions and employers' and employees'
attitudes toward each other.

During the last three weeks of June, visits were
made to each selected farm. The employer and one of his
employees were interviewed on each farm, making a total
of twenty-two interviews. The case study approach was
used as the research method.

The findings of these interviews showed that from
the employers' points of view, the relationship between
corporate farm employers and employees is virtually the

same as the relationship between non-corporate farm

Loren R. Sloat

employers and employees. However, employees interviewed
expressed quite different feelings, especially when com-
pared to the findings of previous studies of non-corporate
farm labor. Most corporate farm employees indicated

that they were much more satisfied with the terms of
employment on the corporate farm than they had been with

terms of employment eXperienced on non-corporate farms.

A STUDY OF CORPORATE FARM
EMPLOYER-EMPLOYEE RELATIONS

By

Loren R. Sloat

A THESIS

Submitted to
Michigan State University
in partial fulfillment of the requirements
for the degree of

MASTER OF SCIENCE

Department of Dairy

1969

CEO/NO
3r/E7o

ACKNOWLEDGMENTS

The author is most grateful to Dr. Charles Lassiter,
Chairman of the Dairy Department, for making available a
Graduate Research Assistantship during the course of this
study.

Appreciation is eXpressed to Drs. John Speicher and
Allen Shapley for their assistance during the course of
this research as well as in the preparation of this
manuscript.

Gratitude is forwarded to those farmers who gave of
their most scarce resource, time, to cOOperate with my
research.

Appreciation is also expressed to my wife, Colleen,
for her assistance in the preparation of this thesis and
for her patience and moral support throughout the course

of this study.

11

TABLE OF CONTENTS

LIST OF TABLES o o o o o o o o o o o o o o o v

Chapter

I IquRODUCTION O O O O O O O O O O O O O O O O 1
II REVIEN OF LITERATURE . . . . . . . . . . . . 3
I I I l'iETHOD OF STUDY 0 o o o o o o o o o o o o o 10
IV CASE DESCRIPTIONS . . . . . . . . . . . . . 15
v THE E1413 LOYEES O O O O O O O O O O 0 O O O O 2 7
Characteristics and Tenure of Employees . 27
Wages earned by employees . . . . . . . . 30
Hours worked by employees . . . . . . . . 36
Hourly wages of employees . . . . . . . 37

VI ATTITUDES TOWARD INCORPORATION AND THE
CORPORATE FARM LABOR FORCE . . . . . . . . . 39
Employers' attitudes . . . . . . . . . . 39
Employees' attitudes . . . . . . . . . . #3
VII EMPLOYER-EAPLOYEE RELATIONS . . . . . . . . 46
Employers' attitudes of employees . . . . 46

Employees' attitudes of employers or
farm managers . . . . . . . . . . . . . . #9
VIII EMPLOYHBS' ATTITUDES TOWARD THEIR JOBS . . . 52
IX S UAI‘J'LRY o o o o o o o o o o o o o o o o o 0 57
X CJNCLUSIONS O o o o o o o o o o o o o o o o 60

iii

XI

SOURCES CONSULTED . . . . . . . . . . . . . . 63

APPENDIX A. Employer Questionnaire
Concerning the Farm 0 O O O O O O O O O O 0 O 65

APPENDIX B. Employer Questionnaire Concerning
the Employee Interviewed . . . . . . . . . . 68

APPENDIX C. Employee Questionnaire . . . . . 71

iv

Table

1.

Summary of employee characteristics and

LIST OF TABLES

eXperiences . . . . .

Summary of wages, hours and fringe benefits . . .

Summary of

incorporation and the

Summary of

incorporation and the

Summary of
reSpective

Summary of
respective

Summary of
attributes

employers'
employees'
employers'

employees.

employees'
employers.

employees'

attitudes
corporate

attitudes
corporate

attitudes

attitudes

attitudes

toward

farm labor force.

toward

farm labor force.

toward their

toward their

toward various

of their respective Jobs . .

29
32

#2

‘+5

#8

51

'55

CHAPTER I

INTRODUCTION

The predominant type of farm organization in Michigan
has been and is the family farm. The size of these farm
units has been restricted to that which can be handled by
the operator, his family and a limited quantity of hired
labor. It has not been unusual for a family farm in
Michigan to have one or two full time hired men, eSpecially
on the more progressive dairy farms. Seasonal labor has
also been used extensively on fruit and vegetable farms
and to a lesser extent on cash crop and dairy farms. The
seasonality of various enterprises, such as sod and fruit
production, requires large amounts of labor at certain
times of the year, and very little labor at other times of
tie year. With the consolidation of many smaller farms into
larger, more efficient units, it has been necessary to hire
even more help.

Facilitation of property transfer, reduction of
liability and risk to each individual involved, reduction
of taxes and improved borrowing position have been the major
reasons gi*en for incorporating the farm business. The

increased farm size has accentuated the reasons for

incorporation. Quite frequently, smaller farms have
found it disadvantageous to incorporate because of the
franchise fee, higher taxes, and the required filing of
an annual report with the state.

It has been hypothesized by the author and others
of the Dairy Department that owners of incorporated farms
have a relationship with their employees that is more
conducive to the acquisition and retention of high quality
labor than owners of non-incorporated farms have with their
employees. This relationship being dependent upon wages,
hours, fringe benefits, working conditions, employers'
and employees' attitudes and other factors that influence
the satisfaction of human needs. If such a relationship
does in fact exist and if this relationship between cor-
porate farm employees and their employers could be document-
ed, then this information would be of considerable value
to those consulting with farmers who are having labor

problems.

CHAPTER II

Review of Literature

A limited number of studies have been made of the
advantages and disadvantages of incorporating a farm
business relative to taxes, prOperty transfer and other
pecuniary aSpects such as large scale buying and selling,
but no research has been done on the labor management
problems of corporate farms. Today's farmer is faced
with a labor shortage which is augmented by the attractive-
ness of industrial working conditions. Farm employees
compare their farm situations relative to hours, wages and
fringe benefits to those faced by their industrial counter-
parts. To be content and satisfied with his farm employ-
ment, the worker eXpects to receive wages and benefits
comparable to that of an industrial worker.

The U. S. Department of Labor (13) has reported that
the average hourly wage for all U. S. farm workers in
1965 was 31.1% (this does not include room and board).

For the same year production workers in factories were
being paid $2.61 per hour. In addition to this $2.61
per hour, the industrial workers were receiving fringe
benefits. Farmers with full time hired men have tradi-

tionally furnished room and board or a house for the hired

3

man and his family to live in. More recently, hired men
have not been content with Just a house and feel they
are worthy of additional benefits in terms of insurance,
paid vacations or retirement plans.

It was reported by Sturt (12) that in October of 1968,
the average hourly wage for hired workers in Michigan was
approximately $1.50. Most farm employees received a house
and other fringe benefits in addition to this wage. The
average hourly wage for the same month in 1968 for Michigan's
industrial workers was $3.85.

Sturt (11) has pointed out that a farmer who is
concerned with returns to land, capital and management may
find it profitable to continue in business even though his
own labor return approaches zero. If capable, high quality
farm labor is obtainable and its use would result in
increased returns per unit of capital and land, it may
very well be worth paying the price necessary to secure
such help.

Society has long viewed the "hired man" as a person
of low social status. The lack of community acceptance of
farm employees has caused potential workers to refuse farm
employment even though they are fully qualified. Given
and Hundley (3) revealed that many hired men on farms had
lost factory jobs earlier because of sickness, poor health
or the inability to get along with fellow workers. Con-
sequently, these same problems are prevalent when these

men are hired by farmers. Other farmers interviewed by

5

Given and Hundley were quite satisfied with their employees.
It was learned that those farmers with satisfactory help
were paying higher than average wages and were giving
the employees regular weekly time off and paid vacations.

An Operator of a typical Michigan farm employs only
a few extra men. Of the 80,000 farm operators in Michigan,
Sturt (12) says that more than half are part time farmers
who earn the largest portion of their incomes from off
the farm. There are 15,000 year-round or full time hired
workers in Michigan which we assume are employed by the
30,000 to h0,000 remaining full time farmers. This amounts
to one full time employee for every two farms. Naturally
many farmers hire more than this and many farmers have no
full time hired help. A farmer with only one or two
employees loses one-third to one-half of his available
labor force if one of his men leaves.

A substantial amount of material has been written
by Dan Sturt of Michigan State University pertaining to
farm labor management. He has pointed out that the pro-
ductivity of an employee is a function of his work environ-
ment. As a prerequisite to an employee's own pride and
self-esteem, he must feel that his job is a very important
one. An employer must eXpress to his employee that he too
considers the job a very necessary and integral part of
the total farm Operation.

The eXperiences of Mr. Sturt (11) have shown him
that most farm workers want to accept reSponsibility.

At the same time, farmers have been reluctant to increase

the responsibilities of an employee because of undesirable
and perhaps costly eXperiences they have had with other
employees. This results in many employees becoming
careless and wanton in their work.

Many workers want an opportunity to advance and grow.
Mr. Sturt (ll) contends that unless provisions are made
for an employee to learn and grow, he will become discon-
tented with his job whether it be farm work or factory
work and will seek out employment which does provide such
Opportunities.

Common to all people is a desire to "belong". Not
only does Sturt believe a farm employee should have a
feeling of being needed in the community, but he should
also be made to feel as an essential element Of the farm
team, eSpecially a team that is progressive and on the
move in agriculture.

Society, the community, the farmers and the employees
themselves have all been reSponsible for some of the
shortcomings of American farm labor. Only when the peOple
learn to accept each other as human beings and understand
each others' needs, can the major problems of farm employees

be solved.

DEFINITIONS:
Since this is a study on employer-employee relations
on corporate ferms, it is essential that first a corporate

farm and its attributes be defined.

O'Bryne at a; (8) have defined a corporation as "an
artificial person which is created and Operated according
to state corporation statutes. It is a separate taxpayer
subject to specific and detailed federal, state and local
tax laws."

A corporation may he created by the state of Michigan
when one or more incorporators (persons signing the articles
of incorporation) decide to incorporate. Once incorporated,
a farm is Operated as any other farm. An annual franchise
fee must be paid and an annual report must be filed with
the Secretary of State.

A corporation usually issues common stock and may
elect to issue preferred stock as well. According to
Samuelson (9), the common stockholder provides equity
capital and possesses the power to vote. Not only does
the common stockholder share in corporate profits, but also
in losses.

Samuelson (9) points out that preferred stockholders
provide equity capital but take no active part in the
direction Of the firm; that is, preferred stock carries
no voting privileges. A stated dividend is paid on pre-
ferred stocks each year no matter how profitable the busi-
ness. These dividends must be paid before dividends can
be paid to the common stockholders.

Farm corporations are usually organized as close
corporations. Marshall (7) in his study of Michigan

corporate farms stated that a close corporation usually

consists of a small number of stockholders who are family
related. The stock of a closely held corporation is not
available for purchase by the public. This means that

the stock is not traded on the Open market but is held only
by those directly involved with the corporation. The

term "closely held" does not denote anything of the size

or scale of the Operation but merely that the stock is

not for sale or capable of being traded to any interested
party.

A Subchapter S corporation or sometimes called a
pseudo-corporation was, as described by O'Bryne g; a; (8),
designed by the United States Congress in 1958, to permit
a small corporation Of ten or fewer stockholders and only
one type of stock to elect a Special method of taxation.
The corporation itself pays no tax but channels its income
through the books to the shareholders who then pay the
Federal and State income taxes on their share of the income
at their own individual income tax rates. Individual tax
rates are usually lower when the individuals are share-
holders Of a small corporation than the tax rate assigned
to regular corporations. Regular corporations are charged
Federal income tax at the rate of 22 percent on the first
$25,000 of income and at 26 percent on all income over
$25,000. The tax rate levied on corporations is not a
progressive one as is commonly known to be levied on per-
sonal income. Thus if after dividing up the corporation's

income and adding each shareholder's portion to his other

personal income he still remains in something less than
a 22 or 26 percent tax bracket, as the case may be, the
pseudo-corporation serves a good and useful purpose.
Similarly, if the personal income tax rate would be greater
than 22 or 26 percent, the regular corporation would be
more advantageous.

This is where some farmers have made mistakes when
incorporating. Their businesses were not large enough
or profitable enough for their taxable income to be taxed
at more than 22 percent if taxed as ordinary personal
income. By electing to form a regular corporation instead
of a pseudo-corporation, their tax rate immediately Jumped
from whatever it was to 22 percent. Thus for small Opera-
tors who wish to have the advantages provided by a regular
corporation, but are not large enough businesses to receive
a tax advantage, it is wise to elect the pseudo-corporation
type of corporation which provides for each stockholder
to pay his share of the tax at his own personal income
tax rate.

The pseudo-corporation retains all other attributes
of a regular corporation except a few minor ones which,

for purposes of this paper, are irrelevant.

CHAPTER III

METHOD OF STUDY

The formation of corporate farms has become a more
pOpular method Of farm organization in the last ten to
fifteen years. A list Of corporate farms in Michigan,
compiled through the joint efforts Of the Dairy and Agri-
cultural Economics Departments at Michigan State University
shows approximately 250 corporate farms now operating in
Michigan. Crossmon (2) has suggested that because of the
relatively few farms which are incorporated and also because
of their great variability, the case method of research
may serve as an apprOpriate research method.

Social worker George Lundberg (6) has made the
following statement: "The case method is not in itself
a scientific metcod at all, but merely a first step in
a scientific procedure; individual cases become of scientific
significance only when classified and summarized in such
forms as to reveal uniformities, types and patterns of
behavior; the statistical method is best, if not the only,
scientific method of classifying and summarizing large
numbers of cases. The two methods are not, therefore,
under any circumstances Opposed to each other, nor is the
one a substitute for the other".

10

11

A noted mathematician, Lancelot Hogben (5) has made
this statement, "Science has its firm foundation in the
recognition of what the world is like. Nothing but con-
fusion can result when mathematics is used pgfggg we
are quite clear about the sort of things with which we
are dealing and what sort of measurement it is useful
to make".

Based on the suggestion of Crossmon, the logic and
reasoning of Lundberg and Hogben, the limited number Of
farms available for study in Michigan (explained in detail
later on), and the time required to survey a large number
Of farms, the decision was made to use the case study
approach. It was also believed that the eXploratory
nature of the case study method Of research would be of
value in uncovering some less obvious facts of corporate
farm labor that otherwise might not bediscovered. _0nce
greater knowledge is gained about any differences that
exist between corporate and non—corporate employers and
employees, a statistical follow-up study would be appro-
priate.

Young (15) has noted that a case study may either be
an exhaustive study of a complete life cycle of a particular
social unit or it may be a study of a definite section of
that social unit. An in-depth study of a complete life
cycle of a social unit would involve a biographical sketch
of every event occuring to that social unit over several

years; whereas a study of a portion of a life cycle involves

12

the careful study of that particular portion, noting as
many relevant facts and events as possible. This study
is of the latter type.

It was decided by the researcher to make personal
on-the-farm interviews rather than to mail questionnaires
to the selected farms. Several reasons led to this decision.
ReSponse to mail questionnaires is very low and since the
number of farms available for surveying was small, nearly
100 percent reaponse was necessary. The information needed
for this study was of a nature difficult to obtain by
means Of a mail questionnaire. Often questions that fringe
on being personal are not answered when asked through a
mailed questionnaire.

Using the following criteria, eleven farms were
selected for study: (1) the farm had to be within a
one-half day driving distance of East Lansing, Michigan,
(2) the farm could not be one of the farms included in a
concurrent study being made by the Agriculture Economics
Department, (3) the farm had to have a least one full time
employee, (H) the farm had to be organized as a corporation,
(5) the employer had to be willing to be interviewed, (6)
the employer had to be willing to have his employee(s)
interviewed and (7) the employee(s) had to be willing
to be interviewed.

Many farms had only one employee and others Just
two or three. The employee who was most readily available

at the time of the farm visit was often the one interviewed.

13

Not all employees on the farms visited were interviewed.
Only one employee was interviewed per farm because of

many farmers having only one employee and those who did
have more than one gave the interviewer the impression

that what there was to be learned about the corporate

farm from employees could be learned from Just one employee.

The survey of the eleven farms, which composed of
interviewing the employer and an employee on each farm,
was done during the last three weeks of June, 1969.

COpies of the questionnaires used are presented in
Appendices A, B and C. Ideas for the questionnaire were
gained through studying questionnaires previously used
by Allen Shapley (10) of Michigan State University and a
booklet published by the University of Minnesota (1).

In general, two types of questions were used. One
was the open-ended factual type of question where the
interviewee was asked such things as when and why the cor-
poration was formed, the types of products produced and
other facts about the corporation, the employer and the
employee interviewed.

The second type of question was the forced answer
type of question. For example, the respondent was given
the statement, "The fact that you are incorporated improves
your farm's image in the community" and given five possible
answers: (1) Strongly Agree, (2) Agree, (3) Undecided,

(h) Disagree and (5) Strongly Disagree.

Three questionnaires were used; one the farm employer

1%

answered concerning the corporation, a second one the
employer answered concerning one of his employees and
the third for this same employee to answer concerning
the corporation, the farm manager, his job and himself.
Aside from the questions asked on the questionnaire,

any relevant comments that were casually made during the
course of the interview were also noted and used where

applicable.

CHAPTER IV

CASE DESCRIPTIONS

To more fully appreciate and graSp the meaning Of
the answers given by reSpondents when questioned, it would
be helpful to know a few facts about each of the farms
on which interviews were made. This section presents
case descriptions of each farm in the study.

Each description outlines the farm in terms of what
products it produced, the size of the Operation, the num-
ber of full time employees and the number of seasonal
employees. The corporate aSpects Of the farms are described
in terms of why and when the farm was incorporated, the
number Of shareholders and any other aspect peculiar to
a particular farm. The position of each employer and duties

of each employee culminate the descriptions.

l5

l6

FARM A

Farm A was a fully irrigated 700 acre sod farm which
employed five full time men and four high school boys to
help with the sod cutting during the summer.

In order to take advantage of tax benefits available
to corporate businesses, the decision to incorporate was
made in 1965. The stock was owned by five common stock-
holders and four preferred stockholders. Among the farms
studied, this was the only one that had preferred stock-
holders. The preferred stockholders were full time
employees who received a predetermined amount of preferred
stock at the end of each year with the Option to purchase
an equal amount of preferred stock within the following
twelve months. Employees were required to work for the firm
one year before they were eligible for this bonus.

The employer interviewed was one of the common
stockholders and was the general manager of the farming
Operation. The employee interviewed was one of the pre-
ferred stockholders and was reSponsible for the sod cutting

Operation.

l7

FARM B

On this farm, 300 acres of land were being used for
the production of sod, blueberries, head lettuce and birch
trees. Full time hired men numbered two, and as many as
ten people were hired as seasonal help.

Heeding the advice Of their accountant, the husband
and wife owners of the then non-corporate farm formed a
corporation in 1957 with the husband owning fifty-one
percent of the stock and the wife forty-nine percent.

The auditor told the owners that by incorporating they
would limit their own individual liability and the estate
would be more easily transferred in the case of death.

It has been learned by the owners since the time of
incorporating that it would have been to their advantage
to have retained the prOperty in their private names and
rented it to the corporation. This would have resulted in
less liability to the owners in case of a suit against
the corporation since each individual stockholder is only
liable for the amount of money he has in the corporation.

The owner of fifty-one percent of the corporation
was interviewed as the employer and the employee inter-
viewed was employed as the farm manager in charge of the

farm operation.

18

FARM C

Farm C produced potatoes, onions and aSparagus
through efforts of six full time men on #00 acres. For
a few weeks early in the summer, thirty people were hired
to do weeding. During the remainder of the production
period, approximately six months, four to five extra men
were hired.

Three reasons were given for incorporating in 1961.
The first reason was to facilitate the transfer of owner-
ship to the sons, secondly to limit the liability of
the parties involved and thirdly to keep the farm operat-
ing continuously as a unit over a period of time. The
father and his son were the only shareholders and at the
time of interviewing, changing to a Subchapter S corpora-
tion was being considered.

The father, interviewed as the employer, was active
only in an advisory capacity while the son served as the
farm manager. The employee interviewed was one that had
been with the farm for nineteen years, thus he knew it as

a non-corporate as well as a corporate farm.

l9

FARM D

Farm D was involved in the production of 250 acres
of the type of potatoes used to make potato chips. One
hundred and twenty acres of field corn and fifty acres
of sweet corn were grown. As many as five seasonal employ~
ees were hired in addition to the four full time employees.

The farm was incorporated in 195% for estate planning
purposes with a father and his son as shareholders. In
1968 the father retired and the son took over as manager.

The son was interviewed as the employer and his
brother-in-law was the employee interviewed. Three of
the employees were brothers-in-law of the manager.

It was pointed out by the son that if his fatter
would have died before reaching retirement age, incorpora-
tion would have been advantageous. However, since his
father has retired it is conceivable that they will even-
tually dissolve the corporation because of the franchise

fee and high taxes.

20

FLRM E

Farm E produced approximately 1,200 acres of radishes
last year. Five full time men and as many as thirty
seasonal laborers have been employed to complete the work
involved with the production and packaging of this pro-
duct.

A corporation consisting of two stockholders with
farms in two other states bought this farm in 1956. Thus
it became a pzrt of a larger already existing corporate
farm business.

One of the two stockholders was interviewed as the
employer. The employee interviewed had been with the farm
for thirteen years or since it was bouaht by the corpora-

tion.

21

FARM F

Farm F as defined by this survey was a 130 dairy
cow operation. The cropping program was carried out by
custom operators. The employee was responsible for the
dairy herd. Milking the 130 cows required most of his
time. His wife assisted him in feeding the cows and
other light chores. High school students were hired when
necessary to help with baling.

The farm had been in the family over 100 years, being
passed from the original owner to his son. The son, now
a grandfetier, made the decision to incorporate in order
to ease the transfer of the farm prOperty to his child—
ren and grandchildren. Thus the farm was incorporated
in 1960 with stockholders being the grandfather, his child-
ren and grandchildren. The total number of shareholders
being approximately twenty.

Officially, the farm has been under the management
of a professional farm manager. However, the president
of the corporation periodically visited the farm and the
employee often counseled with him rather than the farm
management service. For example, the day of the inter-
view, the corporation president and the employee were
discussing the purchase of some additional cattle.

The president of the corporation was interviewed
as tie employer and the man hired to manage the dairy herd

was the employee interviewed.

22

FARM G

Farm G was a fruit farm with #00 acres of apple and
pear trees, the majority of which were apple trees. Three
full time employees and from thirty to fifty seasonal
employees have aided in the production of the fruit.

All the help that has ever been needed during the
past thirty-three years has been obtained from the same
community in Kentucky.

The corporation was formed in 1957 with a father
and three sons owning the stock. The primary reason for
incorporating was to limit the liability of each person
involved.

The president of the corporation was interviewed
as the employer and a full time man who has been with the
farm for twenty-seven years was the employee interviewed.

The state health inSpector had said that the bunk
house provided for the seasonal employees on this farm

was one of the best in the state of Michigan.

23

FARM H

Farm H has been engaged in feeding out feeder steers.
Three full time men have been employed to raise the crOps
necessary to feed out approximately #00 head of cattle
each year and to do the chores related to the feeding of
the cattle. As many as three high school boys have been
hired when necessary to help during the summers.

To ease the transfer of property from one genera-
tion to the next and to receive tax advantages were given
as the reasons for incorporating in 19h9. Five persons,
all members of a family, own the stock of the corporation.
If they had it to do over again, they said they would
organize as a Subchapter S corporation.

Only one of these five Siareholders has been involved
directly with the farm and he was interviewed as the
employer. The employee interviewed was responsible for
the cropping division of the farm and had nothing to do
with feeding the cattle.

The original incorporator of Farm H bought the farm
and Operated it as a self-supporting unit aside from his
industrial interests. The farm has not been subsidized
by the industrial profits of the owners and continues to

be a profitable, selfesupporting farm.

2H

FARM I

Farm I was a 1,000 acre cash crop farm. The crops
grown have been corn, wheat and soybeans. One man has
been hired for nine months out of the year to help the
two brothers who own and operate the farm. This man has
found alternative employment during the winter months
when work on a cash-grain farm is quite slack. If needed,
one or two high school boys have been hired to drive
tractor during busy periods of the year.

The corporation was formed in 1957 by the two brothers
who had been farming previously under a partnership
arrangement. The firm had been experiencing some rather
rapid growth and it was felt that incorporating would give
greater liability protection to the brothers than the
partnership arrangement.

One of the brothers was interviewed as the employer
and the man hired for nine months answered the questions

on the employee questionnaire.

25

FARM J

Farm J was a cash-crOp and beef farm. Five hundred
head of beef steers have been fed out annually in addi-
tion to the production of corn and certified seed oats.
One man has been hired to manage the whole farming Opera-
tion and care for the beef cattle. A high school boy had
been hired to work on the farm during the summers.

In order to facilitate the transfer of the farm
property, which has been in the family since 185%, to
the children of the present owner; it was decided to
incorporate the farm business in 1961. As a result, the
estate could gradually be reduced by giving shares of
stock to the children over a period of several years,
thus reducing the Federal estate taxes. The president,
his wife and their three children were the shareholders
although the president owned only a small portion of the
stock when the interview was made.

None of the children have been active on the farm,
but the father continues to reside there and oversees
the farming activities. The winter months have been spent
by the president and his wife in Florida.

The president was interviewed as the employer and the

farm manager as the employee.

26

FARM K

Three hundred and sixty-five head of feeder steers
have been fed out annually on Farm K using the grain
and roughage produced on the six hundred acre farm. One
man has been employed to work along with the owner in the
Operation of this farm. As many as four high school boys
have been hired when needed to help with the baling, but
the remainder of the work has been done by the owner and
his employee.

Estate planning was given as the reason for incor-
porating in 1959. The shareholders at the time of the
interview were the owner, his wife and the trust depart-
ment of a bank which held the stock previously owned by
the current owner's father who had recently eXpired.

It was pointed out by the corporation president that
the corporation had fulfilled its purpose in transferring
the property from his father to himself, but he was con-
vinced that there are cheaper alternative ways to accomplish
the same thing. The additional expense of incorporating
had more than offset any savings that it procured.

The president was interviewed as the employer and

his full time worker as the employee.

CHAPTER V

THE EMPLOYEES

C a r T Em

As illustrated in Table l, the corporate farm employees
interviewed for this study ranged in age from 23 to 62
years and had from 6 to 12 years of formal education.
It was not always the younger men who had the greater
amounts of education; in fact the youngest employee in
the study had only 8 years of education.

Only 1 employee was unmarried. 0f the remaining 10
employees, 9 had at least one child.

The work experience of all employees was agricul-
tural related. Of the five employees that had been raised
on a dairy farm or previously worked on one, only one
remained employed by a dairy farm.

Length of employment ranged from 9 months to 27
years. The average length of employment on these eleven
farms was 11 years compared to 3.9 years on the farms studied
by Shapley (10).

Relative to the work performed at the time of inter-
viewing, the author would classify employees B, E, F and
J as hired managers capable of Operating the farm as

any owner-Operator would. The remainder of the employees

27

28

would be categorized as "hired hands" requiring super-

vision.

 

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name» ones“ as. new.
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omuaaaouco
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augments
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seamen. ace; agmaa can“ he‘s: a co nomuaa ¢\m Nd nausea: on u
3.3
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at:
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cowuncoao
sees a... as 32.3%.. 2: Ea . a as... . 2 Eta. a .1
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«coaaau scam «sewage; an“: acne» ac «can» finance: oo< cahoga-u

 

Amoofi .caawgofi: .m-aah ounccqeou =u>o~u ac acaamv

«mocoweoaxu new mowumdcuuoacmgu moaoAQ-u be >Lwnuam .d Udm<b

 

30

w Ea E e

Of primary importance to any employee are the wages
he receives in return for his services rendered. Employees
are paid a variety of ways, but typically each receives
a cash wage and some additional fringe benefits, such
as housing. Some employees are also given a bonus cash
payment at the end of each production year. The value
of this bonus depending on the profitability of the farm
that particular year.

Table 2 breaks the payment of each employee into
the component parts of cash wages, cash bonuses and
incentives, non-cash fringe benefits and vacation time.
The total wages are then broken down further into hourly
wage rates which are discussed in the next section.

Cash wages were paid on an hourly basis by Farms D,
G and I while the remainder of the farmers paid their
employees on a salary basis. IrreSpective of the method
of payment, the cash wages received ranged from $3,900
to $15,000. In a study completed at Michigan State
University, it was found that employees' cash incomes
on Michigan dairy farms visited by Given and Hundley in
1966 (3) ranged from $2,160 to $6,000 per year. A more
recent study, completed by Allen Shapley (10) of Michigan
dairy farms, reported annual cash incomes (excluding
bonuses and incentives) ranging from $2,h50 to $8,000.
Even if the extraordinarily high wage of $15,000 were

31

disregarded, the average wage of this study would be
$6,917 which is near or exceeds the top wage reported

by the other two studies.

32

688...... 3323-8 .3 «5....- ozoa. 3 2:5- 8? 8.: 82:89.28 332.

 

 

 

 

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«.323
5.5 «8: 3:88
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S 2.8.. as... 5.3 2......) :25 S 2.3. 3.8 ton»: map:
£8: 3.. p 2.3.. 23: ~32 35.2fl 3.2» 25:83 58 9......— &< 8335

2:8... as as...

 

ASS .5352 .33.. 322:8 5.63 a. €33
3...... as: a. 23.. .89.. .0 Calm .N 3...:

 

33

An incentive payment was made on only one farm,

Farm A. The sod industry has established the cost of
cutting a square yard of sod at three cents. Keeping the
employer's cost of cutting a yard of sod to less than three
cents meant that the employee would receive 15 percent of
the difference between the actual cutting cost and the
established three cents. The more sod he was able to cut
with his fixed supply of labor and machinery, the lower
the per unit cost of cutting a square yard of sod. The
week prior to interviewing, this payment had amounted to
sue. Usually the incentive payment totaled at least
$1,000 per year.

Year-end cash bonuses were received by four of the
employees. Employee B's bonus was based on the wages
received by him and was usually from six to ten percent
of his annual cash wage. Employee J has been given money
at the end of each year which was not a function of
anything. Last year, his last monthly check was $1,000
instead of the usual $k50. One year the bonus money was
given in silver dollar coins. Employee H received a
bonus based on the gross profit of the farm; four percent
of the gross profit of the feedlot. Depending on the year,
this bonus has ranged from $0 to $1,000. Employee D
received a cash bonus of $200 to $250 each yenr, depending
on the profitability of the farm. No set formula was used

to determine the amount of bonus paid to employees on

3%

Farm D.

Employer A gave an annual bonus of preferred stock.
Last year, $300 worth of preferred stock was given to the
employee interviewed with the option that he could pur-
chase an equal amount within the succeeding twelve months.
The amount of stock given was determined by how profitable
the farm had been for the year.

The employee on Farm G received no bonus. When his
employer was asked whether an incentive payment or bonus
was paid he replied, "Nope, we just pay good wages."

Table 2 shows the hourly wage paid by Employer G was among
the highest reported.

Employer K was not paying a bonus, but had considered
doing so.

The "Annual Value of Fringe Benefits" column in
Table 2 includes the value of housing, utilities, insur-
ance and value of farm products. Not every employer pro-
vided all of these benefits. Employer B was the only one
who did not furnish a house. Utilities were paid by the
corporation on Farms A, E, F, H, I and K. Some type of
insurance (life, health or accident) was provided by Farms
A, B, C, D, E, H, I and J. Farm products were provided
for employees on Farms A, C, D, F, H and K. Farms A
and H were the only farms to provide all four of the mention-
ed fringe benefits. The total value of these fringe benefits
ranged from $120 to $3,120. The average annual value of

fringe benefits reported by Shapley (10) was $1,222 compared

35

with $1,129 for this study. The value reported by Shapley
is given only to establish a bench mark, the small number
of corporate frrms surveyed does not permit a statistical
conclusion.

Annual paid vacations were given to employees On
eight of the eleven farms. Employees A, C, D, J and K
received one week vacations, Employees E and H were allowed
two week vacations and Employee B was given a three week
vacation. Employees A and B, however, were given the
option to receive pay above their salaries if they worked
instead of taking a vacation. This amounted to $200 for
Employee A and $800 for Employee B. (These figures were
not included in computation of tota1_annual wages).

This study has shown that the total annual income,
including bonuses, incentive payments and fringe benefits
received by corporate farm employees ranged from $k,950
to $16,250. The figures in Shapley's report of hired
labor on Michigan's dairy farms show a range of $2,h50
to $10,200 for total annual incomes. It must be remembered
that only one employee per farm was interviewed for this
study. Many farmers had only one employee, but of those
farmers employing several employees it was often the most
resoonsible employee that the interviewer was permitted
to interview. Although there was no positive evidence
to support this assumption, it must be acknowledged that
such occurences could quite easily cause the resulting

figures to be biased upward. Wages of different employees

36

on the same farms could very well have been different.

A11 wages reported are what might be expected to
be paid for services rendered on a farm except one, that
of Employee B. There was no reason given as to why this
employee received 816,250 total annual income; however,
he did not have a house or utilities provided for him
by the corporation as all other employees did. It was
assumed by the author that this high wage was due to the
success of the farm and the competence of the employee.
Working for one farm for fifteen years and being given all
the reSponsibility for the managing of that farm certainly
must be an indication of the dependability of the employee.
It can also be assumed that this high wage has been necessary
to keep the man with the farm.

The employee on the lower end Of the total wage range
was paid $h,950 total wages per year. AlthOugh this is
the low figure for this study, it is only $1,000 per year
lower than the average total income (including bonuses
and fringe benefits) of $5,9h2 on Michigan dairy farms
as reported by Shapley. Consequently, the author does
not consider this an abnormally low total income, especially
when compared to the low of $2,H50 total annual income

reported by Shapley on Michigan dairy farms.

H9225 Weeked bx Employeee

Employees on the farms studied worked an average

of 62 to 63 hours per week. Some of the employees who were

37

employed by the sod and vegetable farms worked many more
hours than this during the summer, but they were not
required to work as many hours during the winter season.
Shapley's figures (10) show that 63.6 hours were worked
per week on Michigan's dairy farms, which is very comparable
to the figures of this study. Given and Hundley (3)

found that the employees they interviewed worked from 50
to 60 hours per week. These hours are less than the hours
worked per week by employees of this study, yet Given and
Hundley reported that one of the most common complaints

of employees they talked to was the number of hours they
were required to work. Employees interviewed for this
study exhibited very little dissatisfaction with the

hours of labor required of them.

Hourly Wages gfl Emplezees

Hourly cash wages (excluding bonuses and incentive
payments) paid to corporate farm employees studied ranged
from $1.36 per hour to $H.50 per hour. The average hourly
cash wage of the eleven employees was $2.18.

The 5#.50 per hour was an unusually high wage to
be paid to a farm employee. However, it must be remembered
that this was the same employee who received $15,000 per
year and was reSponsible for the whole farming Operation
which included the production of sod, birch trees and
blueberries. This same employee had been offered the

position of farm manager by another corporate farm two

38

montts prior to the interview, but decided not to change
employment.

When cash bonuses, incentive payments and the fringe
benefits were included with the cash wages, the total
hourly wages ranged from $1.65 to $h.73. The lowest
total wage, $1.65, was not received by the same employee
who received the lowest cash wage. The value of the fringe
benefits received accounted for the difference. Employee
C, the employee receiving $1.36 hourly cash wage was
receiving 5570 more in fringe benefits per year than
Employee I who was earning $1.50 per hour cash wages.

The average total hourly wage for the eleven corporate
farm employees was $2.56.

Shapley reported a range of total hourly wages paid
on Michigan dairy farms of $.65 to $9.93 per hour, With
the average total hourly wage being $1.83. A large
difference is noted between the wages received by corporate
and non-corporate farm employees. Although all the farms
in Shapley's study were dairy farms, the figures are still
appli able. Only one farm in this study was a dairy farm.
Six otter corporate dairy farms were initially selected
but failed to meet all the criteria used in selecting

the farms to be visited.

CHAPTER VI

AlliTLDhS TONLRD INCORPORATION AND
'Ihb CJhPJRLIELIBJfii LABOR FORCE

Employers' Attitudes

Upon eXplaining the purpose of the study to the
employers concerned, several of them had the same immediate
reaction, which at times made continuing with the question-
naire quite difficult. This reaction was that incorpora-
ting had not influenced their labor situations. Many of
the farms had the same labor force before and after incor-
porating. Therefore, the labor force had not changed
over the years anymore than the personalities and attitudes
of the employees had changed.

The general consensus of opinion among the corporate
farm employers interviewed was that incorporating hindered
more than it helped the farm's image in the community.

It was mentioned by one employer that people unfamiliar

with agriculture were impressed by the word "incorporated"
after the farm name. It was expressed by many others

that the fact that the farm was incorporated caused jealousy
among the neighbors. Thus incorporating did nothing to

improve the farm's image in the eyes of the community.

39

#0

It was thought by most employers interviewed that
the working conditions on a corporate farm were more
favorable to the employee. The reason being that cor-
porate farms were able to obtain the financing to purchase
labor saving equipment, making the work of the employee
more enjoyable.

Employers did not feel that more capable farm work-
ers had a tendency to gravitate toward corporate farms
or thzt corporate farm employees had any more pride in
their work than non-corporate farm employees. The comment
made most often by the employers was "It depends on the
man". The general feeling among employers was that even
though wages on corporate farms were higher than wages
on non-corporate farms, this did not attract the more
capable employees to tie corporate farms.

Closely associated with being capable is being
responsible and motivated. Again, the corporate farm
employers had experienced no appreciable difference
between corporate and non-corporate farm employees with
respect to their willingness or ability to take on respon-
sibility. Likewise, there was no difference in the motiva-
tion of the two types of employees.

Corporate farm employers realized no difference in
the self-esteem of corporate and non-corporate farm
employees. Communication problems between employer and
employees were also reported to be the same on incorporated

farms as on non-incorporated farms.

#1

From the attitudes expressed by employers, employees
were concerned about one thing, their pay checks, irreSpec-
tive of who t”ey were employed by. Incorporating had
little or no effect on the quality of labor the farmers
were able to employ. Thus it was the employee himself,
not the firm which employed him, that accounted for the
differences in labor situations from one farm to the next
and from corporate to non-corporate farm.

Table 3 shows the questions the employers were asked
and the reSponses each gave. This discussion being drawn

from those reSponses.

Summary of Eeployers' Attitudes toward Incorporation and the Corporate Faro Labor Force
(Study of Eleven Corporate fares, Michigan, 1969)

TABLE 3.

 

 

 

State-eats Responded to by the [9910 or

°saa£01doa

lie; oieJodJoo-uou

ueqi Liyttqtsuodsai

go osuas 4332946 2 aAeq
saakotdoo e49; oieiodJog

°saa£01deo

we; aieJodJoo-uou
uau; Menno- £1qu
OJOW 312 sasfloIdoo
IJB} aieJodJogt

°op soakoldea IJBJ
aieJodJoo-uou ueq;
sonxaseaq; 1° suozutdo
Joqfigq snag soafiotduo
IJE} eieJodJoa

 

°op;no:d smoe; aieJodJoo
-oou ueq; suctigpuoo
outxion aneJone; aJom
ODIAOJd SUJB} aieiodJog

“saaKOIdma n42; aieJod
~ooo—uou ueq; nice
Jyaq; u; epgid aJoo
gone one; seafloldeo
e42; nieJodJoa

"sue; aiuodooo-uou
neg; 5-42; aieaodaoo

10} #405 01 9031
SJoxJoA otqedeo 0J0“.

°nguneeoo an;
o; 962:; s,e4e; an;
sononIg batieiodaooox

 

“low-3] <

 

 

1Explanations of sylbols: SA-Strongly Agree, A-Agree, U—Undecided, D-Oisagree, and SD-Strongly Disagree

1+3

Em o e s' Att t s

The corporate farm employees interviewed either
felt that the corporate farms had an advantage over non-
corporate farms or were undecided when asked questions
comparing the two types of farm organization. Although
negative reSponses were made to various questions, there
were always enough positive reaponses to equalize or more
than equalize the negative responses. There was no ques-
tion on Schedule B of the Employee Questionnaire (Appendix
C) where the majority of the employees gave a negative
response.

Seven of the eleven employees reported that they
felt corporate farms tended to pay higher wages than
non-corporate farms. This fact has already been established
with figures in Chapter VI.

It was generally felt among employees that corporate
farms provided more desirable working conditions than
non-corporate farms. This reSponse was almost identical
to that received from the employers. Most employees
credited the corporate farms with having more automated
and up-to-date equipment than most non-corporate farms
they were acquainted with.

Employees thought that corporate farms provided more
opportunity to deve10p and utilize the physical skills
they possessed as well as more Opportunity to learn
management skills. As a result, there existed a greater
Opportunity for their advancement into more reSponsible

positions with higher wages.

m.

When asked if they felt people in the community
considered working for a corporate farm was a more reSpect-
able job than working for a non~corporate farm, the employ-
ees were divided as to the answers they gave. Three said
yes, five were undecided and three said no.

There was no tendency among employees to think
higher quality workers worked on corporate farms than
on non-corporate farms. It was mentioned by one employee
that the wages offered by the employer determined the
quality of worker that would take the job. A highly
qualified worker would not take a job which paid low wages.

Some corporate farms, according to employees, are
heater appearing than other incorporated farms and also
heater than non-incorporated farms. They concluded,
however, that the neatness of a farm is independent of
whether or not the farm is incorporated.

Corporate farm employees do not carry any more
responsibility than non-corporate farm employees, accord-
ing to the employees interviewed. The amount of reSpon-
sibility a man is able to carry is dependent on the man.

Responses to questions asked of the employees appear

in Table h.

[ABLE ‘9. Swary of Eeployees' Attitudes toward Incorporation and the Corporate Fare Labor Force
(Study of Eleven Corporate Fares, Michigan, 1959)

*5

 

 

'saalotdu
we; summon-goo neg;

Lungtuodsu uoe gone neg

 

State-ants Responded to in the Eeplom

sedotdee we; e;eJodJoa

use; a;eJodJoo-uou
e ueg; rue; a;eJodJoo e
no 811113 deioaop KIIn:
am 0; atqtssod s; u

«use;
summon-goo neg;
501de Ja;eou gone

on sue; ”audios

'sue; o;eJodJoo-uou
neg; nae-noun» gm
otqeusop om gone 2

aptnoad sue; OlBJOdJOQ

'sue; ”undies-goo
ueg; sedan ugfigg
fled sue; ”ending

"sue; summon-non
neg; ;uueouupe Jo;
Lnunuoddo uoe gone
opuoid sue; a;eJodJoa

“sue; a;uod
«40ch no you ueg;
sue; ”audios uo upon

suapon numb mm"

mm; a;e.|od.aoo

-uou e an; 50“.“)!
ueg; ”quads” won
5; nae; sundae: e

40; Mum mo I03}
(name eg; u; etdoea

Mame]

 

SA

 

 

1Explanation of sfibols: SA-Strongly Agree, ngee, U-Undecided, Mingree and SD-Strongly Disagree

CHAPTER VII

EMPLOYER-EMPLOYEE RELATIONS

Employezs' Attitudgs of Employggg

On the whole, employers were very well satisfied
with their employees. A few employers admitted that their
men had shortcomings which had to be compensated for,
but for the money they were paying the employees, they
were well satisfied.

Most employees required little supervision and were
capable of accepting reaponsibility. Farms G, I and K,
however, had employees who required more than was consid-
ered average supervision and who were not capable of accept-
ing a great deal of reSponsibility. However, the employers
were satisfied with the work being accomplished by their
employees.

The employee on Farm F was reported to be continually
asking for more reaponsibility; he had recently told the
employer he would like to go to an artificial inseminators
school so he could learn to inseminate the cows himself,
thus saving the corporation some expenses.

The employers who furnished houses for their employees
were satisfied with the way the employees took care of them.
One employer said, "It's an old house, but they take good

#6

l+7

care of it". Another said, "His wife is a better house-
keeper than she used to be, but could still do better".
These comments are typical of those made by the employers,
who, if they were not completely satisfied, were at least
somewhat satisfied with the housekeeping ability of the
employee's wife.

None of the employers had any problems with the
employee's wife. All the wives were reported to be quite
satisfied with the Jobs their husbands had and not dis-
sztisfied with the terms of employment.

A summary of the reaponses received when the employ-
ers were asked several questions about their reapective
employees is presented in Table 5.

It can be concluded that corporate farm employers
were satisfied with their employees, but in conversing
with them, they realized no specific differences in the
help they had before corporating and the help employed

since incorporating.

IABLE 5. Sueeary of Eeployers' Attitudes Toward Their Respective Eeployees
(Study of Eleven Corporate Fares, Hiehlgan, 1969)

 

 

 

State-eats Responded to by the Eeployer

'oaAOIdm Sm mu

poxisgies Atieaifi
AJaA II 1 ‘IIBJOAO

-A;;[;q;suodsoi lo [cap
32045 e Guyideooe lo
anedeo s; uee sgql

’UOISIAJOdnS 5°
[cop ieoifi e CJInbOJ
ion seop ace sgul

'IIH
Jo; peqsran; osnoq
on; 1° aJeo p006 AJaA

sane; aerIdee sgql

soon 9e- sm won on;
ma pawn» Km It! I

'HJIH
Boole 406 o; ee 10; Aseo
AJae 5; eggs s,uee s1q1

eJnu01

«Low-3

 

IA

15

SA

SA

19

18

SA

SA

SA

13
BIA

SA

SA

SA

SA

SA

SA

SA

SA

10

 

 

1Explanation of syebols: IA-Iot Applicable, SA-Strongly Agree, A—Agree,

U-Undecided, 0-Disegree and SD-Strongly Disagree.

L+9

Employeeg' Attitudes of Employers or Farm Magaggrg

The employee on Farm J, who functioned as the farm
manager, said that his situation was no different than
if he owned the farm. He made all the decisions and
solved the problems which developed Just as an owner-
operator would. The fact that the farm was incorporated
had no effect on his relationship with the employer or
corporation president.

The employee on Farm B was also the farm manager
and had little to say in reSponse to Schedule C of the
employee's questionnaire (Appendix C). The employer sel-
dom checked on the farm, leaving full responsibility in
the hands of the employee.

Seven of the eleven employees felt that corporate
farm managers were much easier to get along with than
non-corporate farm managers. None were able to give any
concrete reason as to why. Employees on Farms C, D and G
stated that they could see no difference between corporate
and non-corporate farm managers.

The managers seldom Operated the more complicated
farm equipment themselves but did help with Jobs that had
to be done with perfection; such jobs as mixing Sprays
and setting adjustments on equipment. If a new piece
of equipment was obtained or if a change was made in the
way a Job was done, the managers usually took time to
fully eXplain the changes to the employees. The employees
who did not receive instruction were those capable of

understanding the new situation themselves.

50

Given and Hundley (3) pointed out that the training of
farm employees on the farms they studied was often very
inadequate. On the corporate farms, most of the employees
were either raised on farms or had worked on other farms,
making it easier for them to understand the brief instruc-
tions given by the managers. As a result, there was
little lack of understanding about how something was to

be done. A few employees did have their limitations, but
these were known by the employers and compensated for.

The employees whose employers seldom checked on their work
had achieved a comfortable level of confidence in them-
selves and a similar amount of pride in their work.

Most farm managers were reported to be very slow to
apply pressure on employees who did not complete Jobs
as the manager had requested. In most cases, the employees
thought that the manager considered them more as friends
than as "some person" who worked for him.

Table 6 summarizes the reaponses given by employees
when given various statements concerning their employer
(farm manager).

In conclusion, corporate farm managers tended to be
patient with hired workers, giving them every chance to
prove themselves to him as well as to the community.~
It is beyond the scope of this study to say that such is

not the case on non-corporate farms.

IABLE 6. Sueeary of Eeployees' Attitudes iouard their Respective Eeployers
(Study of Eleven Corporate Fares, Michigan, 1969)

51

 

 

°;[ase;u iuaedtnba
pageattdeoo 040' sq;
$012J0d0 sAeAIe Jabeuee aql

°A11ng inc patJJes
iou sac sisenbaa SIN
A! oanssead AIdde o;
nsgnb s; Jefieuee eq1

°etq Jo; anion oun
euoaeos se ueqi DMOIJJ
esote I go 8J0. se an
;o squgq; Jefieuee eul

-uo;;aegied “3}! snap

«I am we snot me
sdteq 00;;0 Jofieuee an;

State-ants Responded to by the Eeployee

'SJOBBUBI us;
eiuodaoa-uou ueq; um
5001c iafi o; JOISBO aJe
siefieuee e42; eieaodaea

 

0140A A-

no dn snoaua Ioptes
buiwwuem
0“ 0; $qu

nau utetdxe 0; any;
sane; Jafieuee use; egg

canoe;

eaAoIde3

 

SA

15

19

18

13
3A

SO

SO

SD

SA

27

SA

10

 

 

1Explanation of syebols: SA-Strongly Agree, A-Agree, U-Undecided, D-Disagree and SD-Strongly Disagree.

CHAPTER VII

EMPLOYEES' ATTITUDES TOWARD TnEIR JOBS

All the employees interviewed were very much interested
in the work they were doing. This interest was maintained,
in the mind of the author, because their jobs were fulfilling
a large portion of the employees' human wants and needs.

One of these needs is monetary. Ten of the eleven
employees said that their wages were sufficient for the
type of work they were doing. The employee on Farm E
was undecided as to whether or not his wages were sufficient.

None of the employees seemed to have any real com-
plaints about the wages or hours worked except the employee
on Farm F, who felt that the corporation should supply
another man to do chores every other weekend. As it
stood at the time of the interview, any extra help hired
had to be paid for by the employee. The employee was
not willing to give up any portion of his wages in order
to have a few weekends off, so he worked seven days a
week all the time.

All eleven employees indicated that they were well
pleased with the amount of reSponsibility they were given
and likewise felt very secure in their Jobs. There was

no hesitation on the part of any employee to ask for a day

52

53

off when necessary and this may have partially eXplained
why all the wives of those who were married were satis-
fied and happy with the positions their husbands held.

When asked if they received a great deal of respect
from other people in the community, eight said theydid,
two of them said it really made no difference to them
and one said he was not well received in the community
because of the reputation the employee before him had.

In general, the employees were quite well satisfied
with their vacations and other fringe benefits provided
by the corporation. The employee on Farm B said that he
was satisfied with his fringe benefits but was working
on the employer to receive some additional ones.

Employee J had been given vacation days but very
seldom used them because he did not enjoy traveling.

When asked if the Job he had at the time of the
interview suited him better than any other job he knew
of, the employee on Farm I said it did but also that he
could not get a job in industry because of his age. The
employee on Farm C said he liked the job he had before
this one just as well. The remainder of the employees
were well satisfied with their jobs and knew of no other
Job they would have rather been employed at.

All of the employees interviewed except Employee D
were very much Opposed to organized farm labor. Employee
D felt that labor unions could possibly help farm labor
through bargaining for higher wages and increased fringe

benefits.

5%

Table 7 summarizes what the author considered to
be the most important aSpects of the employees feelings
concerning their employment. The table illustrates
quite well the degree of satisfaction of each of the em-
ployees.

IABLE 7. Sue-ary of Eeployees' Attitudes Inward Various Attributes of their Respective Jobs
(Study of Eleven Corporate Fares, Michigan, 1969)

55

 

 

 

State-ents Responded to by the Eeployee

'qu
As or 030305 AJaA (as; 1

"”15 It! 1 AIIIKRW’WS
-OJ :0 IUNOII OH: Hill
peseeId 110A AJOA ee 1

°sixiauéq abutJ:

II we 9mm» I2 I
men I m;

an}; OOJ} pue uotieeee

go zone-e an;
nigh Addeq Assn ee 1

men I not on; ma
Addeu AJOA s; Dill Au

°Aiesseoeu uaqh ggo Aep e
40; use 0; OOJ} too; 1

-Aaoiae;s;;es
0J8 noon I anoq 0R1

‘09 I AJOH 1°
adfiz 0M; 10; }“¢l°!i}“$
eJe caress: 1 safieh any

'10 l0"!

1 go; Jauio Aue ueq;
4011's an 6:10: «0F srui
'ROU OP I 140! AM;

u; paiseaeiu; AJaA ee 1

naan Jed peuon sanou

scion [enuuv Ieiol

0.10001

“Autos;

 

6S

9620
16250

SA

SA

SA

15

SA

SA

A950 55

19

SA

55

7033

9‘20

11150

18

66

13

SA

90

3/‘0

SA SA

SA

55
6D

7270

SA

7920

IA

60

5160

5

SA

7050 6D
6620

10

SA

 

 

1Explanation of systole: RA—let Applicable, SA-Strongly Agree, A-Agree, U-Undecided, D-Disagree, SD-Strongly Disagree.

56

Five of the eleven employees (D, F, I, J and K)
intended to be working at the same job on the same farm
for at least another five years. The employee on Farm
E said he hoped to be a non-shareholding manager of a
corporate farm five years from the date of interviewing.
Employee B indicated his intentions of remaining as a
non-shareholding manager on the same farm for the coming
years. Employee A said his goal was to become a share-
holding manager of a corporate farm while Employee H
had goals of becoming an owner-operator of his own non-
corporate farm. Employees C and G indicated that they would
be retired in a few years. I

When asked if they would accept employment on a
corporate farm again rather than work on a non-corporate
farm, eight of the eleven answered "definitely yes"; two
answered "probably yes" and one was undecided. These
figures indicate that employees have at least a prefer-
ence to work on corporate farms.

None of the employees expressed any real discon-
tentment with their jobs, wages, fringe benefits, or the
amount of work they were asked to do. Consequently, it
can be inferred that the corporate farms visited were meet-
ing and fulfilling at least the majority of each reapective

employee's needs.

CHAPTER IX

SUI-ib-iARY

Eleven incorporated farms in Michigan were selected
for studying during the summer of 1969. Personal inter-
views were made with the employer and one employee on
each farm. The study was designed to be a case study
to record the employer-employee relations that existed
on corporate farms in Michigan at the time of the study.

All the farms interviewed had incorporated either
to facilitate property transfer while maintaining con-
tfnuity of the business, to limit the liability of those
parties with interest in the business or to reduce taxes.
Incorporating had never been considered as a means of
attracting or benefiting hired labor.

The Opinion of corporate farm employers was that
incorporating had exhibited no effect on their labor
situations. They also felt that non-incorporated farms
were having similar problems with hired labor that incor-
porated farms were. One employer commented, "I could
hire labor Just as easy before incorporating as I do now."

A more significant part of this study, however,

was the employees' views of the situation. Employees

57

58

felt that corporate fzrms, as compared to non-corporate
farms, paid higher wages, were more desirable places to
work and were the source of more than menial labor type
jobs for those seeking full time farm employment.

The farm managers or employers were reported to be
quite easy to get along with and did not check up on
employees any more than necessary. The training given
to employees as to new procedures to be used on the farms
was considered adequate and was not a source of conflict.

The employees interviewed were very much interested
in the work they were doing and quite satisfied with their
working conditions. No major complaints were voiced
against the hours worked, the wages received or the fringe
benefits furnished by the corporation.

Among the employees interviewed, there were no com-
plaints of unhappy or dissatisfied wives. Employers were
generally well satisfied with the role their employee's
wife played.

All eleven employees indicated that they were well
pleased with the amount of reaponsibility they were given
and a few were asking for more. The pride and self-esteem
of employees were high and most felt that they were well
reapected by other members of the community. Only one
of the employees interviewed was in favor of some type of
organized farm labor.

Hours worked per week by the employees interviewed

ranged from 5% to 90 with an average of around 63. Wages

59

paid to these same eleven corporate farm employees ranged
from Eh,9SO to $16,250 (including bonuses and fringe
benefits) with total hourly wages ranging from $1.65

to OH.73.

Tenure of the employees included in this study ranged
from 9 months to 27 years. Most of these employees had
expectations of staying with the farm they were on for
at least another 5 years, either continuing as an employee

or advancing to a management position if possible.

CHAPTER X

CONCLUSIONS

Drawing conclusions by comparing the findings of
this study with those reported by Shapley as well as
Given and Hundley, it can be said that the corporate farm
employees interviewed were much more satisfied with their
terms of employment than employees interviewed by either
of the other two studies. General inferences concerning
corporrte farm labor cannot be justified because of the
small sample size and also because not every employee on
each farm was interviewed.

As discussed in the text, the hours worked by cor-
porate employees interviewed and the non-corporate farm
empl=yees interviewed by Shapley as well as Given and
hundley were nearly equal. The values of the fringe bene-
fits received by each of the employee groups were nearly
the same. The cash wages received by non-corporate farm
employees were much lower than those received by corporate
frrm e"“loyees interviewed. The men interviewed for
purposes of this study reported no dissatisfaction with
their hours and this was probably due to a relatively
high pay rate. The employees of Given and Hundley‘s
study were dissatisfied with the hours required of them

60

61

because of the low wages received in return for their
services.

The intent of most of the corporate farm eMployees
was to remain with the farm for as long as possible.
Indicating that the corporate farm for which they worked
had more to Offer them than non-corporate fzrms.

Although the corporate frrr employ rs did not feel

incorporrting he? affected their labor problems one way

A

or another it vzs strnngly exhibited by the employees
that the corporate farm had certain advantages such as
hirher wages, more security and other valuable amenities
to offer employees.

To remain competitive in the bid for hired labor,
today's farmer must consider some of the things being
done by other farmers who have been successful in acquir-
ing and retainins good hired labor. If the limited scope
of this case study on eleven corporate farms is any
indication of wlat is happening on all of Michigan's cor-
porate farms, it can very well be assumed that ircoroorating
does provide certain advantages to employees ttat farmers
who have not incorporated have thus fzr not provided.
These advantages include such things as better working
conditions, higher pay for the same hours worked rnd security.
This does not say that a farmer must incorporate to provide
his employees with such benefits but rather it can be
concluded that whereas the farmers who incorporate their

farm organization are typically the more progressive

farmers, they are also the farmers who are more alert
to the needs and expectations of employees and consequently

make greater efforts to compensate for such needs.

SOURCES CONSULTL’D

(1)

(3)

(H)

(6)

(7)

(8)

(9)

(1o)

(11)

SOURCES CUNSULTED

Carlson, Robert E., Rene V. Davis, George w. England
and Lloyd H. Lofquist. The Measurem n o Em e
Satisfactoriness. Industrial Relations Center.
University of Minnesota. 1963.

Crossmon, B. D., "Research Into Management Problems

of Corporate Farming." Journal gfi Farm Ecgngmig .
XXXV 1953. p. 956.

Given, Charles N. and James R. Hundley, Jr. "Human
Relations on Dairy Farms". Rural Manpower Center.
Michigan State University. 1966.

Harris, Marshall and N. William Hines eds. Familz
Farm Corporations. Agricultural Law Center, College
of Law, University of Iowa. 1963.

  

Hogben, Lancelot. .
w. w. Norton Co. 1951. pp. 22 -225.

Lundberg, George A. "Ca se Work and the Statistical
Iethod. " Sogial ngges, v. 1926. p. 61.

34ershall, James Paxton. "The Close Corporation as
a Form of Business Organization for Michigan Family
Farms." Unpublished Ph. 6. dissertation. Mich: gan
State University. 1961.

O'hryne, John C., N. G. P. Krausz, Neil E. Harl
and Hein Jurgenson. "The Farm Corporation". NCR
Ext. Pub. #11. Ames, Iowa. 1960.

Samuelson, Paul A. Egongmic . 6th ed. New York:
IcGraw-Hill Book Company. 196. p. 88.

Shapley, Allen E., "Full-time Employees on Michigan
Dairy Farms". Rural Manpower Center. Michigan State
University. 1969.

Sturt, Daniel W. "The Countdown on Farm Labor".
Paper presented at National Extension Workshop on
Farm Labor Problems. Lincoln, Nebraska. November,
1966.

63

(1?)

(13)

(1h)

(15)

at.

Sturt, Daniel W. "Farm Labor in Michigan--Facts
and Forecase". Mimeo #11. Rural Manpower Center.
Michigan State University. 1969.

United States Department of Labor. 1966 Manpower
Report. United States Government Printing Office,
Nash ngtnn, D. C. 1966.

Weigle, R. N. and L. H. Atkinson. "The Threat of
Corporate Farming". Economic and Marketing Infor-
mation for Indiana Farmers. Lafayette, Indiana.
Purdue University Cooperative Extension Service.

1969.

Young, Pauline V. §§1egtifljg Social Surveys and
Research. Hrh.ed. New Jersey: Prentice-Hall Inc.
1966. p. 2N7.

APPENDICES

APPENDIX A

Employer Questionnaire Concerning the Farm

65

Farm #

Schedule A
In order that I might more fully understand the answers
to the questions which will be asked, I would like to know

some historical and factual information about your firm.

1. When was this farm incorporated?

2. Very simply, why was it incorporated?

3. What principle farm products do you produce?

h. How many shareholders are there?
6. What is the shareholder-employee structure? (i.e. do

some stockholders work on the farm or are all workers
hired, etc.)

6. Have you ever been associated in any way with a non-
corporate farm?

7. How many full time employees do you have?
8. How many seasonal employees do you have?

9. If the stockholders had it to do over again, would
they incorporate again?

Schedule B

66

This next series of questions relate to how you feel

incorporation influences certain facets of labor manage-

ment.

Please indicate how strongly you agree or disagree

with each of the following.

1.

Strongly Agree Undecided Disagree Strongly

132.233...

Incorporation
lends itself to
more effective
communication
between the em-
ployer and the
employee.

The fact that you
are incorporated
improves your
farm's image in
the community.

The more capable
workers tend to
work for corporate
farms.

Corporate farm
employees take much
more pride in their
work than non-cor-
porate farm em-
ployees.

Corporate farms
provide more
favorable working
conditions than
non-corporate
farms.

Corporate farm
employees have a
much higher opinion
of themselves than
non-corporate farm
employees.

Disagree
() () () () ()

 

 

() () () () ()

() () () () ()

() () () () (~)

() () () () ()

() () () () ()

67

Strongly Agree Undecided Disagree Strongly
1332522... 21.52.2222

 

 

Corporate farm
employees are
more highly
motivated to
get a job
completed than
non-corporate
farm employees.

Corporate farm
employees have

a much greater
sense of reSpon-
sibility than non-
corporate farm
employees.

(

(

)

)

(

(

)

)

(

(

)

)

(

(

)

)

(

(

)

)

APPENDIX B

Employer Questionnaire Concerning

the Employee Interviewed

Farm #
Worker #

Schedule C

Questions about a particular employee.
1. How long has this man worked for you?
2. How old is he?

a. under 20

 

 

 

b. 20-25
_____C. 26’30
____d- 31-35

e. 36-HO

f. h1~h5
____g. Hé-SO

h. over 50

 

3. What is his marital status?

Number of ghildren

a. single
b. married
c. divorced
d. other

 

 

 

h. How much formal education does he have?

6. What experience did he have when he came to work for you?

 

Ygars Typg
a. none
b. farm

c. industry
d. other (specify)

 

 

 

6. What is the gross pay of this man excluding fringe benefits
and bonuses? Si

7. Dies he receive a bonus or incentive payment?

8. What type of bonus system do you use?

9. What is the value of this bonus? 3 /

69
Schedule C (continued)

10. How many hours does this man work on a typical day exclud-
ing meal times?
11. How much of each 7 day period does this man have off?

1?. Do you provide any of the following benefits to this

worker?

X§§ E. XALEE
Housing ( ) ( ) 3 .,per;_____.
Utilities ( ) ( ) m______per______
Room and Board ( ) ( ) $ per
Board Only ( ) ( ) 5 per
Farm Products ( ) ( ) 3 per
Insurance ( ) ( ) 8 per
Paid Vacation ( ) ( ) $______per
Other (Specify) ( ) ( ) $______per

70

Schedule D
How strongly do you agree or disagree with each of

the following statements concerning this employee?

Strongly Agree Undecided Disagree Strongly

 

 

_imumaa_. Qiaaazaa
1. It is of no real ( ) ( ) ( ) ( ) ( )
concern to me how
this man Spends
his time when not
on the job.
2. This employee's ( ) ( ) ( ) ( ) ( )
wife is very easy
for me to get
along with.
3. I am very satis- ( ) ( ) ( ) ( ) ( )

fied with the work
this man does.

A. This employee ( ) ( ) ( ) ( ) ( )
takes very good
care of the house
that is furnished
for him.

a. This man does ( ) ( ) ( ) ( ) ( )
not require a
great deal of
supervision.

6. This man is capable ( ) ( ) ( ) ( ) ( )
of accepting a
great deal of
reaponsibility.

7. Over-all, I am ( ) ( ) ( ) ( ) ( )
very greatly
satisfied with
this employee.

APPENDIX C

Employee Questionnaire

71

Worker #

QULSTIONNAIRE TO FARM EMPLOYEE
Schedule A
The following questions are general information questions

about you and your family.

1. How long have you been employed by this farm?

2. How old are you?

 

 

 

 

 

a. under 20
b. 21-25
C. 26-30
d. 31-35
e. 36-HO
f. h1-h5
_go ’46-‘50
. over 50
3. What is your marital status
Wren

a. single
b. married
0. divorced
d. other

 

 

 

N. Is your wife gainfully employed?

a. No

(Skip to question #5)
(Skip to question #5)

b. Yes - part-time
Yes - full-time

C.

5. How much formal education have you had?

. 6. What experience did you have when you came to work for
this farm?

E

Years
a. None

b. Farm
c. Industry
d. Other (Specify)

 

 

 

 

 

 

 

 

7. How many hours do you work on a typical day excluding
meal time? _____hours

72
Schedule A (continued)

8. What will your gross pay (amount on W-2 Form) excluding
bonuses and benefits be this year?

a. Less than $%,OOO
b. EM,OOO - 54,999

 

 

 

 

d. $6,000 - $6,999
e. $7,000 - 37,999

 

r. 38,000 - $8,999
h. Over $10,006,

 

 

9. Out of every 7 day period, how many days do you have off?

10. How many days of work did you have to miss last year
because of illness or other unforeseen causes?

11. Do you participate in any non-farm activities?

If so, which ones?

12. Do you receive any of the following benefits?

 

 

Xéé ,EQ XALHE
Housing ( ) ( ) 3 per______
Utilities ( ) ( ) a per
Room and Board ( ) ( ) 3 per
Board Only ( ) ( ) $ per
Farm Products ( ) ( ) 8 per
Insurance ( ) ( ) 8 per
Paid Vacation ( ) ( ) 3 per
Other (Specify) ( ) ( ) $ per

73

Schedule B
How strongly do you agree or disagree with each of the

following statements concerning corporate farms in general?

Strongly Agree Undecided Disagree Strongly

 

—££1ii—— e Diaaarae
1. People in the ( ) ( ) ( ) ( ) ( )

community feel

that working for

a corporate farm

is more reSpect-
able than working
for a non-corporate
farm.

2. Higher quality ( ) ( ) ( ) ( ) ( )
workers work on
corporate farms
than on non-
corporate farms.

3. Corporate farms ( ) ( ) ( ) ( ) ( )
provide much
more oppor-
tunity for
advancement than
non-corporate
farms.

h. Corporate farms ( ) ( ) ( ) ( ) ( )
pay higher wages
than non-cor-
porate farms.

5. Corporate farms ( ) ( ) ( ) ( ) ( )
provide a much
more desirable
work environ-
ment than non-
corporate farms.

6. Corporate farms ( ) ( ) ( ) ( ) ( )
are much neater
appearing than
non-corporate
farms.

7%

Schedule B (continued)

Strongly Agree Undecided Disagree Strongly

 

 

Agree Disagree
It is possible ( ) ( ) ( ) ( ) ( )
to more fully
deve10p skills
on a corporate
farm ttan on a
non-corporate
farm.
Corporate farm ( ) ( ) ( ) ( ) ( )

employees have
much more reapon-
sibility than
non-corporate
farm employees.

75

Schedule C

How strongly do you agree with each of the following

statements concerning the manager?

Strongly Agree Undecided Disagree Strongly

 

ism.
1. The farm manager ( ) ( )
takes time to
explain new jobs
to me.
2. The manager very ( ) ( )
seldom checks
up on my work.
3. Corporate farm ( ) ( )

managers are much
easier to get
along with than
non-corporate
farm managers.

u. The manager often ( ) ( )
helps me with jobs
that must be done
with perfection.

5. The manager thinks ( ) ( )
of me as a close
friend rather than
as someone who
works for him.

6. The manager is ( ) ( )
very quick to
apply pressure
to enforce his
requests if they
are not carried
out fully.

7. The manager ( ) ( )
always operates
the more com-
plicated equip-
ment himself.

 

(

)

(

)

Disagree
( )

76

Schedule D
How strongly do you agree or disagree with each of the

following statements concerning your job?

Strongly Agree Undecided Disagree Strongly

 

.Aaxzee Disagree
1. I am very inter- ( ) ( ) ( ) ( ) ( )
ested in the work
I now do.
2. The supplies, ( ) ( ) ( ) ( ) ( )
materials and
equipment needed
to do my job are
easily obtained.
3. I feel very ( ) ( ) ( ) ( ) ( )
secure in my job.
h. The job I now ( ) ( ) ( ) ( ) ( )

have suits me
better than any
other farm or
non-farm job that
I know of.

5. The wages I ( ) ( ) ( ) ( ) ( )
receive are
sufficient for
the type of work
I do.

6. The hours I work ( ) ( ) ( ) ( ) ( )
are satisfactory.

7. Labor unions have ( ) ( ) ( ) ( ) ( )
no place on cor-
porate farms.

8. I feel free to ( ) ( ) ( ) ( ) ( )
ask for a day off
when necessary.

9. I receive a great ( ) ( ) ( ) ( ) ( )
deal of reSpect
from other pe0p1e
in the community.

77

Schedule D (continued)

Strongly Agree Undecided Disagree Strongly
Aeree Disagree

10. I am very well ( ) ( ) ( ) ( ) ( )
pleased with the
amount of res-
ponsibility I
am given.

 

11. My wife is very ( ) ( ) ( ) ( ) ( )
happy with the Job
I have.

12. I am greatly ( ) ( ) ( ) ( ) ( )
satisfied with
the amount of
choice I have
in the way I
can do a par-
ticular job.

13. I am very happy ( ) ( ) ( ) ( ) ( )
with the amount
of vacation and
free time I have.

1h. I am very ( ) ( ) ( ) ( ) ( )
satisfied with
my fringe bene-
fits.

78

Schedule E

Almost all firms have at one time or another disagree-
ments or tensions between groups. Please indicate as
accurately as possible the degree of disagreement between

the following groups.

 

De e Te
Don't Very Great Some Very None
really great amount little
know amgunt
1. Between stock- ( ) ( ) ( ) ( ) ( ) ( )
holders
2. Between stock- ( ) ( ) ( ) ( ) ( ) ( )
holders and farm
managers
3. Between active and ( ) ( ) ( ) ( ) ( ) ( )
non-active stock-
holders
h. Between farm ( ) ( ) ( ) ( ) ( ) ( )
manager and
employees
5. Between farm ( ) ( ) ( ) ( ) ( ) ( )
employees
6. Between new ( ) ( ) ( ) ( ) ( ) ( )

employees and
existing em-
ployees

79

Schedule E (continued)

What do you honestly expect to be doing five years from

now? (check only one)

Being
Being
Being
Being
Being
Owner
Being
Other

hired employee on a non-corporate farm

hired employee on a corporate farm

working shareholder on a corporate farm
shareholding manager of a corporate farm
non-shareholding manager of a corporate farm
Operator of a non-corporate farm

a major stockholder of a corporate farm
(Specify)

mmmmm

If you had it to do over again would you accept employment

with a corporate farm?

a.
b.
Co
d.
e.

definitely no
probably no
undecided
probably yes
definitely yes

 

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